Suppose there are 5 gas stations in Durham. All of them sell, among other things, 87 octane regular unleaded gas. Which of the following best describes the market for 87 octane gas in Durham? a) monopoly
b) undifferentiated oligopoly
c) perfect competition
d) monopolistic competition

b

Explanation:

An Oligopoly is when there are few large firms operating in an industry. While, a monopoly is when there is only one firm operating in an industry.

Oligopolies are characterised by:

87 octane gas in Durham is the same in each of the five stations, so the product is undifferentiated

A perfect competition is characterised by many buyers and sellers of homogeneous goods and services. Market prices are set by the forces of demand and supply. There are no barriers to entry or exit of firms into the industry.  

A monopolistic competition is when there are many firms selling differentiated products in an industry.

A monopoly is when there is only one firm operating in an industry.

An example of a monopoly is a utility company

the answer is a. $209,000

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